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Been on the web killing shit lately.🕷😂 #NYNP Spider-Man Vs Batman Who’s New York’s best super hero?
Design By @theovtlier
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Be the change you want to see in the world. 🗽🚬 • #NYNP #ARTZ #RejectDreams •
$0.88 of Every $1 for Programs: That's Nothing to Brag About!
The following article by Anat Gerstein appeared in the New York Nonprofit Press in March 2015.
By Anat Gerstein
The New York nonprofit sector was shaken recently with the announcement that FEGS, a behemoth nonprofit with a solid long-standing track record in the human services sector, was shutting down because of a huge funding gap. Some believe that FEGS might have run into trouble because of reduced government reimbursement rates, which fail to cover the cost of running programs and providing services--a challenge for many nonprofits.
But, a larger issue looms. Nonprofits are coming up short on funding their full administrative costs and supporting the kinds of administrative capacity expansions--such as creating a research and evaluation team--critical to all well-managed organizations. Some people call these costs "overhead," but "management" or "administrative costs" is much more fitting.
There is some good news: changes in the guidance from the federal Office of Management and Budget (OMB), called "Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards," became part of the Code of Federal Regulations on December 26, 2014.
The new guidance requires states to pay grantees' fully-loaded administrative costs. It's a big win for the nonprofit sector (and comes thanks to a three-year campaign spearheaded by the National Council of Nonprofits). Although there's still a loophole that allows government to cap the administrative costs in some cases, the regulations require payment of at least 10%. While 10% doesn't cover the true management costs of running organizations well, it is a step toward recognizing full costs.
Foundations and other funders are also making a priority of supporting building out nonprofits' management capacity. With growing expectations that nonprofits show outcomes for investments, this kind of support can't come soon enough. Organizations that can prove that their programs work have more access to funding and opportunities to expand.
Performance management isn't the only area where nonprofits need to increase investments.
The Nonprofit Finance Fund, in preliminary findings from their annual state of the nonprofit sector survey, found nonprofits are most concerned about sustainable funding and attracting and retaining top staff.
To be successful in raising money, today's nonprofits not only need a good fundraiser, they also need IT systems to support fundraising efforts and a communications expert to consistently craft the kind of content that connects with donors and potential donors. To retain top talent, in addition to compensating them, nonprofits must invest in IT, HR, and operations.
Of course, most nonprofits know all this. So what can be done about it?
1. Nonprofits must stop calling it overhead! These are management, administrative, or indirect costs, and they are absolutely necessary.
2. Nonprofits should stop talking about how little is being spent on management, and start talking instead about how investment in management has led to improved results (and the ability to report on them).
3. Nonprofits must define management costs and talk to funders about them (along with #2 above). If funders want to support strong programs, they should know what it takes to run them.
Focusing on and investing in management leads to success. Just look at Row New York, Graham Windham, and Leake & Watts, winners of last year's New York Community Trust Nonprofit Excellence Awards, which are managed by the NonProfit Coordinating Committee of New York. This paper documented their management practices and corresponding successes in the December issue. These organizations have increased fundraising, brought on smart, dedicated staff, and shown outcomes of their programs. For their investment in management, they have grown and have been able to more efficiently and effectively serve their clients.
Othole-Qn-Factfile
Michael Sylvester Mukama Aka Othole is a Christian artiste and music producer at the Kenyan Based N.Y.N.P and we previously interviewed him on the 3rd of feb 2014 and really enjoyed it, but there are some itchy facts you just have to know about him… (more…)
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